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Wednesday, December 28, 2011

Ahh that wonderful FICO score. It follows us everywhere and it only seems to become more important as time passes. Potential employers, landlords, and of course banks all want to know your score. If you have less than great credit, the credit repair companies may sound like a good deal. They promise to improve your credit score for a sometimes outrageous fee. The really crazy part- you can do it all by yourself! But why bother? Having a higher FICO score means that you get better deals on loans sure, but it also makes you look better in the eyes of landlords and potential employers. While neither can discriminate on the basis of race, sex, religion etc., you can be disqualified from a job or a potential housing situation if your credit isn't good. So how do you fix it?

The easiest way to improve your credit score is to pay your bills on time. Depending on your lending institution, they may not report a late payment every now and then, but if you are chronically late on your obligations, they can and will put it on your credit report. Those little dings add up. If you are late on several bills a month, your score can go down significantly. Utilities, credit cards, and car loans can all report late payments.

The second easiest thing to do is check your credit history. The safest way to do it is to go to www.annualcreditreport.com. You can request a report from all three major credit reporting companies. These reports are FREE once a year from each company. You can certainly pull all three at the same time, but savvy consumers pull them every 4 months from one company in a rotating fashion. This way you can check your credit more often. You do NOT have to pay for these reports. If you want to know your specific score, you will have to pay for that, but it really is not necessary unless you are expecting a big financial hurdle like trying to get a mortgage. If you pull your free report and find no negative marks, you are probably in pretty good standing. You can dispute any negative marks that you believe are incorrect or older than 7 years. Most negative items should be removed automatically as time passes, but they aren't always. Also, sometimes institutions report items inaccurately. A bank may state that your account was closed for delinquency, when you closed it yourself. That item may hurt your credit score and disputing it may get it off your record or at least changed so it doesn't reflect negatively anymore.

One of the hardest things to do in this economy is also the best for your credit score- pay down your debts. If you have outstanding revolving accounts- credit cards, store accounts, accounts that accept a monthly payment- you should work to pay those off as quickly as possible. Keeping an empty credit card will increase your usage ratio- how much debt you have versus how much you could have- which will up your score.
These are just three ways to increase your score easily and for free. There are lots of other tips out there. You can check out this article for more information.

It's important for potential tenants and clients alike to know that we run credit checks and call references for potential tenants at Provident Property Management. We believe this helps protect our clients and their assets, as well as other tenants in a multi-unit dwelling. If your current management company doesn't offer these services, ask them why. Then call us so we can help you!